Indian Markets Show Resilience Amid U.S. Tariff Challenges

Indian stock markets opened on a positive note despite new U.S. tariffs, as global companies brace for business disruptions. While domestic momentum continues, experts warn of cautious investor sentiment due to international uncertainties, with Indian and U.S. discussions ongoing to mitigate mutual tariff impacts.

In a show of resilience, Indian stock markets opened positively on Wednesday, undeterred by the U.S. President's recent announcement of reciprocal tariffs set to begin on April 2. Companies from Japan to Mexico are preparing for potential price hikes, reduced demand, and disruption to supply chains as they navigate the impact of these new U.S. trade policies.

The BSE Sensex commenced the day with an increase of 162.63 points, reaching 73,152.56. Meanwhile, the Nifty 50 saw a rise of 52.85 points, opening at 22,135.50. A total of 30 companies on the Nifty index advanced, while 20 retreated, indicating a climate of cautious optimism among investors. Leading performers included M&M, Power Grid, HCL Tech, BPCL, and Adani Ports, while Bajaj Finance, Bajaj Finserv, SBI Life, HDFC Bank, and Sun Pharma experienced declines.

Ajay Bagga, a banking and market expert, highlighted the tariffs' impact, explaining that global markets were affected on Tuesday, with widespread concerns in companies ranging from Japan to Mexico. As businesses and consumer confidence faltered under the unpredictable Trump policy, China unveiled a fiscal stimulus proposing a 4% fiscal deficit for 2025 to target a GDP growth of 5%, countering export challenges. Bagga noted the rarity of such widespread tariff actions since the protectionist era of the 1930s.

Despite robust domestic economic activity, Bagga cautioned against potential global pessimism impacting investor sentiment. "For India, there's hope to reach an agreement to avoid mutual tariffs with Union Minister Piyush Goyal in the U.S. for discussions," he stated, forecasting a careful market outlook influenced by global volatility despite strong local momentum.

Akshay Chinchalkar from Axis Securities, observed how the Nifty managed to slightly recover from its morning weak spot, marking a historic tenth consecutive day of decline. However, signs of recovery are emerging though the market remains on the lookout for a definitive trigger. Analysts anticipate global uncertainties to influence short-term trends, particularly amid ongoing U.S.-India trade discussions, and will keep an eye on policy measures from major economies in response to rising protectionism and subsequent economic slowdowns.

(With inputs from agencies.)